Will Alteogen, a South Korean biopharmaceutical company, make the leap from KOSDAQ to KOSPI? The question has gained traction after Hyeong In-woo, the company's second-largest shareholder and CEO of Smart & Growth, publicly advocated for the transition. In response, Alteogen acknowledged that it is “reviewing the matter,” a statement seen by the market as a positive signal. Attention is now focused on whether Alteogen meets all the necessary criteria for a KOSPI listing and when the shift might actually occur.
According to the financial industry on July 10, a KOSDAQ-listed company must undergo a screening process equivalent to a new listing in order to transfer to KOSPI. The basic requirements include equity capital of at least KRW 30 billion and a minimum of one million shares issued. The company must also meet share distribution requirements, such as at least 25% of shares held by general investors or more than five million shares publicly owned.
In terms of business performance, the company needs to satisfy at least one of five financial benchmarks related to sales, profitability, and market capitalization. For instance, a company with annual sales of KRW 100 billion or more in the most recent fiscal year—or an average of KRW 70 billion over the past three years—must also post operating, pre-tax, and net profits, while meeting one of the following: a return on equity (ROE) of at least 5%, or net profit of KRW 3 billion or more. However, for companies like Alteogen with a market capitalization exceeding KRW 1 trillion, that figure alone fulfills the performance requirement. The company must also have received an unqualified audit opinion in the most recent fiscal year, as well as unqualified or qualified opinions in the two preceding years.
Alteogen currently satisfies nearly all these quantitative requirements. As of the first quarter, its equity capital stood at KRW 347.6 billion, with 53.31 million shares issued and 73.8% held by general shareholders. The company posted revenue of KRW 102.9 billion last year, with a three-year average of KRW 76 billion, and reported pre-tax operating profit of KRW 36.6 billion. Its ROE stood at 29.5%, and it received unqualified audit opinions for the past three consecutive years.
In fact, Alteogen has met the formal listing requirements for several years. Its market cap exceeded KRW 1 trillion in 2022, and its equity and public float ratios have consistently surpassed KOSPI thresholds since its KOSDAQ days. However, a KOSPI listing is not solely a matter of meeting numerical targets—it also involves qualitative assessments such as sustainable profitability and financial stability. Given this, the company had taken a cautious approach, weighing market conditions and its performance trajectory. But with a turnaround in operating profits starting last year, observers now believe the final decision rests squarely with management.
Should the company proceed, it would need to obtain special approval from shareholders and submit a preliminary listing application to the Korea Exchange. If approved, Alteogen would then apply for delisting from KOSDAQ and initiate the formal process of joining the KOSPI.
The latest momentum behind the move was sparked by recent comments from Hyeong In-woo of Smart & Growth. He noted that since Alteogen briefly held the top market cap on KOSDAQ a few years ago, he has consistently encouraged CEO Park Soon-jae to consider the switch. Hyeong argued that the move would not only elevate the company’s image but also attract more passive investment and offer better protection against short selling.
He further pointed out that with no remaining peer group on KOSDAQ, Alteogen is at a valuation disadvantage. Once milestone payments from sales of the subcutaneous formulation of Keytruda begin, he said, there would be no reason to delay the transfer any longer. Following his remarks, Alteogen’s share price rose for three consecutive trading days, reflecting market enthusiasm.
Analysts also view the potential move favorably. Kim Sun-ah, an analyst at Hana Securities, highlighted that the company's key asset, ALT-B4, is protected by patents through 2039, offering ample time for revenue generation. Based on valuation metrics drawn from competitors like Halozyme and Samsung Biologics, Kim projected that Alteogen’s market cap could reach KRW 30 trillion following the move. As of July 10, its valuation stands at around KRW 24 trillion.
An Alteogen spokesperson said, “We are reviewing the necessity of the KOSPI transfer from multiple perspectives, but no final decision has been made. Any updates will be announced through regulatory filings.”
Still, the move to KOSPI is not without risks. Unlike KOSDAQ, which emphasizes growth potential, the KOSPI market places greater weight on actual financial results. If a company fails to deliver strong earnings after its transfer, its stock may undergo corrections. The transition can also bring about heightened short-term volatility. When Celltrion moved to KOSPI in February 2018, its market cap surged by more than KRW 2 trillion on the first day to KRW 35.3 trillion, only to fall by 23% to KRW 26.9 trillion a year later.
Kim Dae-jong, a professor of business at Sejong University, noted that a move to KOSPI would significantly broaden Alteogen’s access to institutional and foreign investors, creating a more favorable structure for capital raising. This, he added, is particularly advantageous for biotech firms, which often require long-term funding for drug development.
He emphasized that the KOSPI is generally seen as a marketplace for more mature companies, which could enhance Alteogen’s external credibility in terms of its technology and business fundamentals. That, in turn, could positively influence global partnerships with both domestic and international pharma firms. However, he cautioned that KOSPI demands higher standards of disclosure, internal controls, and financial health. Companies with volatile earnings or inadequate management systems may struggle to meet market expectations post-listing, potentially leading to share price declines. This is especially relevant for biotech firms, whose profitability is often unstable and subject to stricter scrutiny.
